Research Desk responds: Do conservative states get more federal money?

By Dylan Matthews

joemomma1 asks:

Is it true that more conservative states receive a larger percentage of money for social programs?

Andrew Reamer and Rachel Blanchard Carpenter at Brookings have helpfully broken down federal aid in Fiscal Year 2008 by state. It's not really useful to graph 50 data points, so hop over there to see specific states' numbers. First, I took the average amount of federal aid given to states won by Obama in 2008 versus those won by McCain. The Obama state average ($11,097,466,205.93) dwarfs that of the McCain states ($8,579,954,939.86), but that is to be expected, given that McCain's states tend to be smaller, and this measure does not take population into account. So I instead averaged the per capita aid given to each candidate's states. Here's the result:

There's a small advantage for Democratic states, but nothing dramatic. Now, one might object that the 2008 election was exceptional, with many normally conservative states turning blue. So here is the same measure done with the state breakdown from the 2004 election:

While that may look dramatic, it is important to remember that a lot of federal aid to states -- Medicaid, welfare, education funds -- go disproportionately to poor cities, and Democratic states tend to be more urban than their Republican counterparts. So while joemomma1 was incorrect in thinking that Republican states receive more, on average, from the federal government, it is hard to view the discrepancy that is there as all that significant.

Addendum: Some commenters suggested that joemomma1 actually meant to ask whether it's true that Republican states are more likely to get more in federal expenditures than they pay in taxes. This is, in fact, true; nationally Republican states West Virginia and Alaska and swing state New Mexico have the highest expenditure to tax burden ratio, while New Jersey and Connecticut have the lowest, with California and New York not far behind. For more, see the Tax Foundation's report, "Federal Tax Burdens and Expenditures by State". The data is slightly out of date, but the basic point still holds.

I think the stat that joemamma was thinking of is relative to the amount of revenue derived from the states. In other words, blue states get back less in federal aid than they pay in taxes while red states get more back than they pay in... I'm not sure if that's actually true, but might be worth investigating.

As Dylan says, Dem states get more per capita because there are more poor urban areas in Dem states. The more useful metric is to look at states that get more in funding than they pay in taxes. I believe red states come out far ahead there.

This is more than a little skewed. Defense spending is federal spending too. A job is the best social program going and there are a ton of jobs associated with basing decisions and the military. I'd say this comparison is too limited to be of any real use. You've singled the "mommy" program spending out and it's still a horserace. What does the "daddy" spending look like by state? Whether they go to WIC or weapons tax dollars all spend the same.

"Some commenters suggested that joemomma1 actually meant to ask whether it's true that Republican states are more likely to get more in federal expenditures than they pay in taxes. This is, in fact, true"

Lance, i agree that this isn't a very big deal overall. However, as Dylan's addendum makes clear, the point that many of were making is indeed true. Blue states are slightly more likely to be "donor states" whereas red states are slightly more likely to receive more federal money than they pay in. This does not prove any type of fundamental inequity, or that the money is spent either well or poorly.

What tcjutras said in the first comment: this is gross, not net. My understanding is that many rural and southern (mostly Republican) states get far more federal spending than they send in federal taxes, and many urban and northern (mostly Democratic) states do the reverse.

Also, these numbers are for "fiscal 2008"; when does the federal fiscal year start, and do these numbers include TARP and other credit-crunch spending, which have accentuated the urban concentration of "funding for social programs"?

And, as jamusco points out, what is "funding for social programs"? Does it include farm subsidies? Even if it includes those, does it include disguised subsidies, like the cut-rate prices the Federal government charges for grazing and mineral rights on federal lands, mostly in states of the south and west that often vote Republican?

One excellent point I've seen raised (in a recent issue of The American Prospect, I think) is that while we often know to the penny how much money the government spends directly, but have little idea how much the government spends indirectly, in money forgone by targeted tax cuts and cut-rate goods and services.

As noted above, the Brookings data are kind of oddly biased (the report cited uses a definition of 'assistance spending' that's designed to focus on grants that are allocated based on Census data, so they're far from complete). And if you factor in Federal taxes paid as well as Federal aid received ('net' vs. 'gross' aid) you'd get a very different picture.

But it's also worth pointing out most of the spending included in this analysis goes to programs like Medicaid, foster care, etc. - programs where the Feds match state & local spending. The share of spending in those programs that the Feds pay varies according to a formula, and as it happens the states that tend to vote Republican also tend to fare very well in that formula (they have more poor people & a smaller tax base so they get more Federal aid in return for a smaller outlay of their own funds). If you deduct that state match from the gross Federal aid, you'll see that Federal spending is much more generous to Republican-leaning states - even before you take into account the very small share of Federal taxes those states pay.

At least this isn't due to political favoritism - it's a benefit that the most conservative states (especially the former Confederate ones) have earned for being steadfastly poor and backward. It's a direct result of their generations-long project of social regression and woefully ineffective economic development.

Thanks for the clarification and comments. I'm a little under the weather today and the nuance didn't come out in my original question. Dylan is correct in his update: I was thinking in terms of total-in vs. total-out, and for all programs (farm subsidies, military, medicare).

@tomwoods: I'm still processing your last paragraph. Interesting. I wonder what this does to Tea Party arguments?

I'd like to point out that the Brookings numbers are for "aid" to states (plus DC), while the Tax Foundation numbers are for expenditures in states (plus DC), which are vastly different things. The latter include, for example, all the money the federal government spends in Washington DC, like the salaries of all federal employees who work in Washington, so the money-in money-out formulation of the Tax Foundation data is really nonsensical.

But, "total-in vs. total-out, and for all programs (farm subsidies, military, medicare)" isn't what the Tax Foundation's report describes: some notes to the report are significant when interpreting the results.

The honesty of the initial post is appreciated. A $300 per capita difference multiplied by 300,000,000 or so capita is a pretty big partisan payoff.